This is incorrect. Instagram names are essentially impossible to recover (unless you know an insider) and there’s a liquid market for them.

Same is not true of paypal funds.

I have an instagram account that I basically don't use, created probably 10+ years ago. At one point I randomly decided to log in and found that my username was randomized and someone else (not even a brand account) was using my original name. I never got any emails about my account being accessed, my password was random, no login activity, etc. To this day I'm still wondering if the account was compromised without a trace or if instagram just decided to give my name to someone else.

Keep in mind that stolen credit cards sell for a couple of $, having a sim swapped paypal account wouldn’t offer you much of an advantage here.

The reality is that cashing out significant amounts of money this way tends to be rather difficult.